Chinese Moonshot AI, developer of the Kimi models, is in negotiations to end a corporate dispute with Recurrent.ai and its investors before a possible initial public offering in Hong Kong. The information was revealed by Reuters in an investigation published on October 11. The financial claim could exceed US$ 700 million, according to a source familiar with the case.
The conflict is being heard in arbitration in Hong Kong since 2024 and involves Moonshot CEO Yang Zhilin and its chief technology officer, Zhang Yutao. Both founded Recurrent in 2016, before creating Moonshot in 2023, and remain linked to the first company's corporate structure.
Recurrent claims compensation equivalent to 10.5% of the original shares
Recurrent received 9.5% of Moonshot's original shares when the startup was founded. Now, the company and part of its investors claim an additional compensation equivalent to 10.5% of those original shares.
A person consulted by Reuters estimated that the claim could exceed US$ 700 million, considering the valuation of US$ 30 billion attributed to Moonshot in a funding round held in June. The amount is an estimate, not a value agreed between the parties.
The dispute involves accusations that Yang and Zhang created Moonshot without authorization from Recurrent's board, provided false information to investors and used resources from the former company for their own benefit.
A letter sent in March by Recurrent's lawyers also accuses the executives of transferring servers with artificial intelligence model data without authorization and ordering the deletion of other files. Reuters was unable to independently verify these allegations.
Yang had already denied the accusations in 2024, according to reports from Chinese outlets. That year, legal representatives of the executives also contested the legal and factual grounds of the case.
The dispute comes as Moonshot prepares its entry into the stock market. In September, Reuters revealed that the company had confidentially filed documents for an IPO in Hong Kong.
A source close to the conflict said that the dispute should not derail the offering, but its continuation could raise questions about governance, shareholding structure and disclosure of information to investors.
The negotiations for a deal still have no known deadline for completion. Nor have definitive financial terms been disclosed or a confirmed date for the initial public offering.
